What is Overbought?
Overbought describes a reading, usually from an oscillator like RSI, that says price has risen quickly and is stretched to the upside. It is a statement about momentum, not a guarantee that price will fall. Strong trends can stay overbought for a long time.
Why Overbought matters
It flags a fast, stretched move, but on its own it does not mean a reversal is coming.
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Lessons that use this term
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